Why lots of people are using password managers in the first place, I don't know. Seems wildly insecure to me, though I am ofc no expert.
Because otherwise you'll need to recycle your passwords which is much worse. You cannot remember 10's of them and remember from which particular website they are.
Are you saying that a password manager re-creates new passwords? That sounds unlikely, as I would think that you would have to manually change the passwords for all your websites anyway. Am I perhaps missing something here? (Edit: I guess a password manager could generate a random string of characters, but I would think that you would still do some manual work to start the process of changing passwords for every single website.)
Btw, I am thinking that professionally, so called 'key management' is an important aspect to say the military afaik, which has to issue new keys around so that they this way won't allow re-using old keying material, which presumably would be bad for anything to do with operational security. For civilian use, with the poor infrastructure of the internet, and computing in general, I can't imagine that it is a good idea to keep re making your passwords if the passwords were long and complicated in the first place. I would think that anyone having placed a keylogger on your keyboard or in your computer, like say some organization, would then be able to round up all your new passwords in a much shorter period of time.